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Economic uncertainty is causing staff to strive for promotion with their current employer rather than look elsewhere.
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Better the devil you know for employees with recession fears
07 February 2023
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Fear of recession is causing staff to seek promotion at their existing employer rather than move elsewhere, according to HR technology supplier Elmo Software.
Its research found more than eight out of 10 were concerned about an economic downturn and that was motivating one-third to stay put, a further 16 per cent to look for a new job with their current employer and 20 per cent to stay in their job regardless.
Elmo Software CEO Danny Lessem said businesses needed to be aware of changing worker sentiment.
“While turbulent economic times are driving employees to stay with their current employer, they are being loud and clear about what they want and need,” said Mr Lessem.
“In the absence of the automatic promotions and pay rises offered by new jobs, employees have indicated that they will be actively looking for opportunities to advance their careers within their current company.”
“It would be a mistake to think that, just because they are choosing safety over taking a risk, employees are adopting a passive approach to managing their career.”
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The research showed employees would take a more proactive approach in managing their careers as the number of workers likely to request a pay rise or promotion rose from 36 per cent in 2021 to 44 per cent.
“For HR teams and people managers, this research emphasises the importance of regular performance and development conversations with your team members, ensuring salary benchmarking is up to date and succession plans in place so that internal talent is not being overlooked when hiring for roles,” said Mr Lessem.
The latest ABS retail sales stats revealed a fall of 0.2 per cent in the December quarter, the first time since the 2021 September quarter that it had fallen which ABS head of retail statistics, Ben Dorber, said was a by-product of the rising cost of living concerns.
“Retail sales volumes fell for the first time since the September quarter 2021, with volumes falling across all non-food industries as consumers tightened discretionary spending in response to mounting cost of living pressures,” said Mr Dorber.
“The fall in the December quarter sales volumes suggests that the robust post-lockdown spending that fuelled much of the growth in 2022 has come to an end.”
Elmo Software’s research also found recession concerns varied with an employee’s age, with Gen Xers and Baby Boomers most nervous. Gen Xers were the most likely group to stay in their jobs over recession fears, at 36 per cent, while 52 per cent of Baby Boomers ranked the stability of their organisation as a top five priority.
“We’re starting to see differences emerge between Baby Boomers and older Gen Xers who have experienced a recession first hand, and younger workers who are yet to go through a downturn in their working lives,” said Mr Lessem.
“Organisations should be aware about how their employees are feeling about the potential of a recession and what their individual priorities might be at this time.”
“A one-size-fits-all approach to flexible working, salary and development opportunities is not the answer.”
A recent CPA Australia poll found 29 per cent of respondents were either uncertain about their job security or thought it was insecure due to economic conditions.
CPA Australia senior manager of business policy Gavan Ord said rising concern about job security was understandable.
“It’s unsurprising some workers are feeling nervous about their future employment given the current economic challenges, increasing cost of living and rising interest rates make people more anxious about their financial situation,” said Mr Ord.
“Household budgets are under pressure and our members are telling us that businesses face significant challenges, clearly the instability businesses are feeling is flowing through to employees.”
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